Corporate Eye

One Man’s Stakeholder ….

Think of 1984 and somewhere in between the famine in Ethiopia and Michael Jackson’s hair catching fire, you’re likely to think of George Orwell’s famous dystopian novel.

Part of this is Newspeak, which is characterised by the absence of synonyms or antonyms, meaning that there is only one “authorised” word for any given thing or activity.

1984 is also the year in which R. Edward Freeman published his book “Strategic Management”. It was here that the concept of a stakeholder was coined to describing anyone who affects or is affected by a corporate body.

I would not for a moment class the term “stakeholder” as being part of any form of Newspeak, especially as it’s one of the more useful terms to have come out of the linguistic wave which swept through business in the 1980s.

However for a concept whose management principles will be 25 years old next year, it’s interesting to note that companies are still unsure how to use their websites to communicate sustainability to their stakeholders.

The Five Amigos
At the basic level, there are five types of stakeholder: customer, supplier, investor, employee and community member. All of these are relatively easy to define, with the exception of the last which can be something of a catch-all.

Business websites have traditionally been seen as a shop window for businesses. They have been designed to attract customers passing by on the high street of the information superhighway, with the express purpose of selling them something.

To that end, websites have are typically aimed at the company’s customers. In addition, public companies normally have an Investor Relations section and larger companies often have intranets to serve the needs of their employees.

Community and supplier relations, on the other hand, are often conducted offline as befits their nature. The latter in particular can be shrouded in gloom as the precise nature of the relationship is often commercially sensitive.

Everywhere and Nowhere
One of the prime principles of sustainability is that it needs to be embedded into a business at every level. By rights, this should mean that sustainability is part of all aspects of a business’ website.

The sustainability report itself is often part of the Investor Relations section, as good a place as any for dry reports on the business’ performance.

However, wider discussion of the company’s policies and, in particular, their effect upon the businesses’ stakeholders should be found throughout a website as appropriate.

For instance, clothing retailers ought to discuss their sourcing of clothes from North Africa and Asia alongside the sale of those garments, instead of leaving it to the customer to ferret around to find the information they’re looking for.

Similarly, those with a presence in every town ought to describe how they contribute to both the communities in which they sell their products and the wider social community of the UK.

No more Mr Price Guy
They key here is realising that money can no longer be the sole rationale behind a business.

Many larger companies may have the attitude that they provide jobs and income and that that is as good a contribution to the community within which they operate as any.

Sustainability, on the other hand, is about far more than the redirection of funds to a less environmentally damaging commercial model.

It’s about realising that we need to work together towards a common future. That we are united as stakeholders in that common future, with the issues affecting one set of stakeholders affecting us all.

If companies wish to continue to enjoy the huge freedoms and flexibilities they have built up over the last hundred years they need to take the lead and understand that sustainability cuts across all strands of their business.

If they do not then regulators and legislators will start making decisions for them, exercising their right as stakeholders to ensure that good business practice is followed.

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A former CTO, Chris has a broad and varied background. He’s been involved with blue chips, consultancies & SMEs across a wide variety of sectors and has worked in Europe, the Middle East and Australia. In 2007 he decided to combine his knowledge of business and IT with his passion for all things sustainable and has been busy writing ever since. However, his greatest ambition remains to brew the perfect cup of coffee.
Morten Jess Nielsen

Dear Mr. Milton

I have to give a presentation about a stakeholder management approach to corporate social responsibility next week. I it the defence of my thesis. I was really impressed by your depiction of the stakeholder model, because it emphasises that this is about human. Therefore I would like to ask you whether it is all right that i use your model? And if you a huge favor by sending me it in a larger format?

Kind regards

Morten Jess Nielsen

Thank you very much for your comment, Morten Jess Nielsen.

I have replied through email.

Best wishes — Chris

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